Andre J. Peschong

As I mentioned in an earlier post I attended the Roth Capital Conference at the Dana Point Ritz Carlton.  This is an extremely well attended conference focused on the small capitalization public marketplace.  There were over 300 companies presenting from all industries and continents.  This year Roth Capital featured companies from India, most trading on the Mumbai stock exchange but some from regional stock exchanges in India.  There was a very strong showing and focus on Chinese companies and in fact there was an entire speaking panel and track on doing deals in China.  This was extremely informative as it laid out the landscape both from a legal perspective and a practical standpoint.  One thing was very clear through this track; the deal landscape is changing rapidly because of the shear amount of Chinese companies looking to go public in the US.  As with all capital markets the margins eventually compress as more and larger players enter the space and this is true for Chinese companies as well.

I was able to catch up with many old deal buddies that I lose contact with over the years as we get wrapped up in our own deals and defending our respective part of the sandbox.  The general consensus or better, ‘the mood’ of the event was very upbeat on deals, the economy and carving out new niches.  One question that was universal was how bad is it going to get on the real estate side?  Really digging into that question reveals that the investment community really wants to know how much will the real estate market ripple through and affect deals getting done.  At this juncture, it’s anyone’s guess, but one thing is for sure, everyone I spoke to believes this is a year to hunker down and batten down the hatches.  In other words, we’ll have to work twice as hard to stay in place or as I like to call it “winning the battle of attrition”.  The good news, is it will eventually get better, it always does.

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